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EXHIBIT 10.10
EMPLOYMENT AGREEMENT
This Agreement, dated as of August 14, 1998, is made and entered into by
and between Nutraceutix, Inc. (the "Company") and Xxxxxx Xxxxxxx (the
"Executive or Xxxxxx Xxxxxxx"). For the definition of certain terms used in
this Agreement, see Section 6 below.
Upon the execution of this Agreement, all prior employment discussions,
whether written or oral, between the Executive and the Company, or any of its
parents, subsidiaries, affiliates, or predecessor constituent, are terminated
and are of no further force and effect.
SECTION 1 - CONTRACT
1.1 Engagement. The Company hereby employs Xxxxxx Xxxxxxx and Xxxxxx
Xxxxxxx hereby accepts employment with the Company as its Vice President of
Sales and Marketing during the Term, subject to and in accordance with the
provisions of this Agreement.
1.2 Duties. Xxxxxx Xxxxxxx will function in the capacity of Vice
President of Sales and Marketing and shall be responsible for all sales and
marketing by the Company. This will include but not limited to sales of private
label health supplement manufacturing, product sales, technology licensing, raw
ingredient sales and such other sales or other activities as may be assigned to
Xxxxxx Xxxxxxx by the President from time to time. The President and Board
of Directors reserves the right to extend or curtail the specific
responsibilities of Xxxxxx Xxxxxxx from time to time.
1.3 Extent of Service. During the Term Xxxxxx Xxxxxxx will devote his
full-time attention to the business of the Company, and will not, without the
Company's prior written consent, directly or indirectly engage in any
employment, consulting, contracting or other activity which would interfere or
conflict with the performance of Xxxxxx Xxxxxxx'x obligations to the Company,
as described in this Agreement.
SECTION 2 - COMPENSATION
2.1 Base Salary. During the Term, the Company will pay Xxxxxx Xxxxxxx a
base salary of one hundred fifty thousand dollars ($150,000) per year. The base
salary will be payable in accordance with the customary payroll practices of
the Company (but in no event less frequently than semi-monthly) as the Board of
Directors of the Company may determine.
2.2 Commission and Bonus. Xxxxxx Xxxxxxx may receive commissions and
bonuses equal to up to fifty percent (50%) of his base salary. Such commissions
and bonuses will be based on certain levels, profitability and other corporate
objectives to be determined on an annual basis by the Compensation Committee of
the Board of Directors, and will be paid to Xxxxxx Xxxxxxx if he meets all
qualifications therefor established by the Compensation Committee of the Board
of Directors.
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2.3 Corporate Investment Opportunity. Xxxxxx Xxxxxxx will receive an
incentive stock option to purchase two hundred thousand (200,000) shares of
common stock of the Company at a price equal to their fair market value as of
the closing on the date of grant, vested over three (3) years and subject to
the Company's Stock Option Plan.
2.4 Benefits. Xxxxxx Xxxxxxx will be eligible to participate in such
employee fringe benefit programs as the Company makes available to its
employees from time to time (e.g., medical, dental, disability, 401(k) Plan) to
the same extent as other full-time employees of the Company.
2.5 Vacation. Xxxxxx Xxxxxxx will receive three (3) weeks paid vacation
during each year of the Term as well as such holidays and floating holidays as
the Company makes available to its other full time employees on an annual basis.
2.6 Expenses. The Company will reimburse Xxxxxx Xxxxxxx for his
out-of-pocket expenses directly and reasonably incurred in performance of
service for the Company under this Agreement (e.g., transportation, lodging
and food expenses while traveling on Company business) in accordance with the
Company's standard guidelines and requirements for such reimbursement.
2.7 Relocation Reimbursement. The Company will reimburse Xxxxxx Xxxxxxx
for his out-of-pocket expenses directly and reasonably incurred in moving
himself, his family and his possessions to the Redmond, Washington area, up to
a maximum of ten thousand dollars ($10,000.00). Such reimbursement will be in
accordance with the Company's standard guidelines and requirements for
reimbursement, including but not limited to furnishing of all receipts for such
costs and expenses.
SECTION 3 - TERM AND TERMINATION
3.1 Commencement. The Term will commence on September 8, 1998.
3.2 Termination. Xxxxxx Xxxxxxx'x employment by the Company pursuant to
this Agreement will be employment at will. As such, the Term will terminate on
the earlier of (i) the three (3) year anniversary of the commencement date set
forth in paragraph 3.1 or (ii) upon the first of the following to occur: (a) the
Company's termination of this Agreement for any reason or no reason with ninety
(90) days notice; (b) Xxxxxx Xxxxxxx'x termination of this Agreement for any
reason or no reason with ninety (90) days notice; (c) the death of Xxxxxx
Xxxxxxx; or (d) the disability of Xxxxxx Xxxxxxx resulting from injury, illness
or disease, whether of a mental or physical nature, which prevents him from, or
substantially impairs his ability to, satisfactorily perform his duties and
obligations under this Agreement for sixty (60) consecutive days.
3.3 Return of Company Property. Upon the Company's request, and in any
event promptly upon termination of the Term, Xxxxxx Xxxxxxx will deliver to the
Company any and all property of the Company in Xxxxxx Xxxxxxx'x possession or
control (including, but not limited to, any and all Materials).
SECTION 4 - CONFIDENTIALITY
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4.1 Confidential Information. Xxxxxx Xxxxxxx will have access to certain
Confidential Information in the course of his employment by the Company. Xxxxxx
Xxxxxxx will use and disclose Confidential Information solely for the purposes
for which it is provided, and will take reasonable precautions to prevent any
unauthorized use or disclosure of the same. Xxxxxx Xxxxxxx will not use or
disclose any Confidential Information in any manner contrary to the best
interests of the Company.
4.2 Proprietary Information of Others. Xxxxxx Xxxxxxx will not, in the
course of his employment by the Company or at any other time, use, disclose or
otherwise make available to the Company, any information, documents or other
items which Xxxxxx Xxxxxxx may have received from any other person (e.g., a
prior employer) and which Xxxxxx Xxxxxxx is prohibited from so using,
disclosing or making available (e.g., by reason of any contract, court order,
law or obligation by which Xxxxxx Xxxxxxx is bound.)
4.3 Work Product. All Work Product which Xxxxxx Xxxxxxx develops or first
reduces to practice during the Term, either alone or with others, together with
any and all related Intellectual Property Rights will be the sole and exclusive
property of the Company. The foregoing applies to all Work Product which relates
to Xxxxxx Xxxxxxx'x performance of services during the Term and/or with the use
of any equipment, supplies, facilities, personnel, Confidential Information or
other resource of the Company.
4.4 Disclosure and Protection of Work Products. Xxxxxx Xxxxxxx will
promptly disclose to the Company in writing all Work Products which Xxxxxx
Xxxxxxx develops or first reduces to practice during the Term, either alone or
with others. At the Company's request, Xxxxxx Xxxxxxx will assist the Company
or its designee in protecting such Work Products and securing or perfecting
all applicable rights therein. Such assistance may include, but is not
necessarily limited to, the following: (a) making application in the United
States and in foreign countries for patents or copyrights on any Work Products
specified by the Company; (b) executing documents of assignment to the Company
or its designee of all of Xxxxxx Xxxxxxx'x right, title and interest in and to
any Work Product and related Intellectual Property Rights; and (c) taking such
additional action (including, but not limited to, the execution and delivery of
documents) as may be necessary or appropriate to perfect, evidence or vest in
the Company or its designee all right, title and interest in and to any Work
Product and any related Intellectual Property Right.
4.5 Materials. All Materials and related Intellectual Property Rights
will be the sole and exclusive property of the Company, whether or not such
Materials are marked with any Intellectual Property Right notice of the Company
or Xxxxxx Xxxxxxx. All such Materials authored, made, conceived or developed by
Xxxxxx Xxxxxxx or made available to Xxxxxx Xxxxxxx (or any copies or extracts
thereof) will be held by Xxxxxx Xxxxxxx in trust solely for the benefit of the
Company. Xxxxxx Xxxxxxx will use such materials only as required in the course
of his employment by the Company or as otherwise authorized in writing by the
Company.
SECTION 5 - NONSOLICITATION
5.1 Nonsolicitation. During the Term of this Agreement and for a period
of three (3) years after termination, Xxxxxx Xxxxxxx will not directly or
indirectly solicit or entice any of the
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following to cease, terminate or reduce any relationship with the Company or to
divert any business from the Company: (a) any executive, employee, consultant
or representative of the Company; (b) any contractor or supplier of the
Company; (c) any customer or client of the Company; or (d) any prospective
customer or client from whom Xxxxxx Xxxxxxx solicited business within the last
year of the Term. Further, Xxxxxx Xxxxxxx will not directly or indirectly
disclose the names, addresses, telephone numbers, compensation, or arrangements
between the Company and any person or entity described in (a), (b) or (c) above
to any competitor of the Company.
SECTION 6 -- DEFINITIONS
Whenever used in this Agreement with initial letters capitalized, the
following terms will have the following specified meanings:
6.1 "Board" means the Company's Board of Directors.
6.2 "Company's Field of Business" means any of the fields of the
Company's business. On the date of this Agreement, the Company's field of
business is natural product development, manufacturing, research and
consulting, and sourcing for the human health and animal health markets.
6.3 "Confidential Information" means any information that is
confidential, proprietary or trade secret information of the Company or any of
its customers or clients or any other information the use or disclosure of
which by the Company is prohibited or restricted (e.g., by reason of any
contract, court order, law or other obligation by which the Company is bound).
"Confidential Information" may include, but is not necessarily limited to,
technology, computer programs, business plans, marketing plans, information as
to existing or future products or services of the Company, financial
projections, unpublished works of original authorship, customer lists,
financial information, and trade secrets.
6.4 "Intellectual Property Right" means any patent, copyright, trade
secret, trade name, trademark or other intellectual property right.
6.5 "Materials" means software, programs, manuals, drawings, designs,
articles, writings, data, notes, memoranda, manuscripts, lab notebooks,
cultures, proposals, work plans, interim and final reports, project files,
client contract records and other tangible manifestations of any Confidential
Information or Work Products.
6.6 "President" means the Company's President.
6.7 "Term" means the term of Xxxxxx Xxxxxxx'x Agreement with the
Company, as described in Section 3 of this Agreement.
6.8 "Work Product" means any invention, discovery, concept or idea
(including, but not necessarily limited to, software programs or processes,
techniques, know-how, methods, systems, improvements, proprietary formulations,
analytical reports, genetically engineered organisms, plasmids and other
developments).
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SECTION 7-MISCELLANEOUS
7.1 Compliance with Laws. In the performance of this Agreement, each
party will comply with all applicable laws, regulations, rules, orders and other
requirements of governmental authorities having jurisdiction.
7.2 Equitable Relief. Xxxxxx Xxxxxxx acknowledges that: (i) the
provisions of Sections 4 and 5 are essential to the company; (ii) the Company
would not enter into this Agreement if it did not include such provisions; (iii)
the damages which would be sustained by the Company as a result of any breach of
such provisions cannot be adequately remedied by damages; and, (iv) in addition
to any other right or remedy that the Company may have (e.g., under this
Agreement, by law or otherwise), the Company will be entitled to injunctive and
other equitable relief to prevent or curtail any breach of any such provisions.
7.3 Nonwaiver. The failure of either party to insist upon or enforce
strict performance by the other of any provision of this Agreement or to
exercise any right, remedy or provision of this Agreement will not be
interpreted or construed as a waiver or relinquishment to any extent of such
party's right to consent or rely upon the same in that or any other instance;
rather, the same will be and remain in full force and effect.
7.4 Notices. All notices permitted or required hereunder shall be in
writing and shall be deemed given upon personal delivery or mailing, postage
paid, certified mail, return receipt requested, to the following address: (i) if
to Xxxxxx Xxxxxxx, to his primary residence; (ii) if to the Company, to its
principal office.
7.5 Other Provisions of Employment. Xxxxxx Xxxxxxx'x employment by
the Company pursuant to this Agreement will be subject to and in accordance with
the provisions of the Company's Employee Handbook, as the same may be modified
or amended from time to time; provided that to the extent that any provision of
this Agreement conflicts with any provision of the Company's Employee Handbook,
the provisions of this Agreement will control.
7.6 Unenforceable Provisions. The invalidity or unenforceability of any
provision of this Agreement will not affect the other provisions of this
Agreement, and this Agreement will be construed in all respects as if such
invalid or unenforceable provision were replaced with a valid and enforceable
provision containing terms as similar as possible to the provision replaced.
7.7 Entire Agreement. Except as stated in paragraph 7.5, this Agreement
constitutes the entire agreement, and supersedes any and all prior agreements,
between the Company and Xxxxxx Xxxxxxx. Sections 4 and 5, and any other
provision of this Agreement that may reasonably be construed as surviving the
termination of the Term, will survive the termination of the Term. No amendment,
modification or waiver of any of the provisions of this Agreement will be valid
unless set forth in a written instrument signed by the party to be bound
thereby.
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7.8 Applicable Law. This Agreement will be interpreted, construed and
enforced in all respects in accordance with the local laws of the State of
Washington, without reference to its choice of law rules.
THE COMPANY: NUTRACEUTIX, INC.
By: /s/ XXXXXXX X. ST. XXXX
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Xxxxxxx X. St. Xxxx
President
Date Signed: August 12, 1998
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XXXXXX XXXXXXX:
/s/ XXXXXX XXXXXXX
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Xxxxxx Xxxxxxx
Date Signed: August 14, 1998
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